Posted on November 16, 2010

Social Innovation Fund Grant-Decision Process to Be Audited

The inspector general charged with oversight of the Corporation for National and Community Service is looking into the decision process used by CNCS's Social Innovation Fund to award its inaugural round of grants, the New York Times reports.

The fund's grant-decision process came under scrutiny earlier this year when critics raised questions about the transparency of the process and potential conflicts of interest. The audit, which CNCS requested, may lead to recommendations for changes in how SIF distributes funds, this year totaling some $50 million, it receives from Congress.

The fund came under fire after announcing its inaugural cohort of grantees. Some criticized the process involved in the selection of New Profit, Inc., a Massachusetts-based venture philanthropy fund that provides multi-year financial and strategic support to innovative social entrepreneurs and organizations to help them realize their full potential. Paul Carttar, executive director of SIF, had worked at New Profit before accepting an invitation from the Obama administration to head up the newly created innovation fund. As the Times and other sources had reported previously, Carttar recused himself from the fund's grantmaking process.

Commenting on the decision to audit SIF, Ashley Etienne, a spokesperson for CNCS, told the Times, "Our entire motivation is to ensure that what we've done and the processes we've put in place are fair and consistent and meet their expectations in terms of the procedures we used."